Senior citizens looking for stable and predictable returns often turn to fixed deposits (FDs). Several major public sector banks, including State Bank of India (SBI), Bank of Baroda (BoB), Punjab National Bank (PNB) and Canara Bank, offer higher interest rates for senior citizens on selected FD tenures.
For deposits of ₹5 lakh, ₹10 lakh, ₹15 lakh and ₹20 lakh, the amount earned will depend on the interest rate and tenure selected. Since each bank follows a different rate structure and offers higher rates on specific periods, investors need to look at both the interest rate and the maturity period before opening an FD.
Senior Citizens Get Additional FD Interest
Fixed deposits remain a popular choice among senior citizens because they provide a relatively predictable return while keeping the invested amount in a bank deposit. Banks generally provide an additional interest benefit to eligible senior citizens over the standard rate available to regular customers.
SBI, Bank of Baroda, PNB and Canara Bank have deposit options where senior citizens can receive interest rates of 7% or more on selected tenures. However, the highest rate is not available for every FD period, so the tenure is an important part of the comparison.
SBI, Bank of Baroda, PNB and Canara Bank FD Rates
The four banks have different FD structures, including regular deposits and special-tenure options. SBI’s published retail deposit rates, for example, show a 7.05% senior-citizen rate for deposits with a tenure of five years and up to 10 years under the applicable scheme.
Bank of Baroda’s current deposit schedule also shows senior-citizen rates reaching above 7% on selected special tenures, including its 555-day deposit scheme.
PNB’s current domestic term-deposit rates similarly show senior-citizen rates of 7% or more on selected tenures, including its 444-day and 666-day options.
Therefore, simply comparing the headline interest rate may not be enough. The investment amount, tenure, applicable senior-citizen rate and maturity value all need to be considered together.
How Much Can You Earn on ₹5 Lakh to ₹20 Lakh?
For investments of ₹5 lakh, ₹10 lakh, ₹15 lakh and ₹20 lakh, the final maturity amount will vary according to the bank, interest rate, tenure and method of interest payment.
A higher rate can increase the interest earned, but a longer or shorter tenure may produce a different overall maturity amount. Senior citizens should therefore compare the complete FD terms instead of selecting a deposit only because it advertises a 7% or higher interest rate.
The actual return can also differ depending on whether the FD pays interest periodically or compounds it until maturity.
Disclaimer
This article is provided for general information purposes and should not be treated as financial or investment advice. FD interest rates, special schemes, eligibility conditions and tenure options may change at the discretion of individual banks. Readers should check the latest official rate applicable to their deposit amount and tenure with the respective bank before making any investment decision.